As a certified management accountant, Vincent Sebastiano held jobs as a controller and director of finance before coming to W. E. T. in September 2010. W. E. T. specializes in warming-electronic technology, and controls the majority of the seat-heating market.
The company, which was founded in 1968 in Munich, Germany, has 11 offices worldwide and 5,000 employees, including a customer-service centre in Windsor, Ontario, with 100 employees, and a production facility in Mexico. W. E. T. was recently acquired by competitor Amerigon, and is relocating its headquarters from Odelzhausen, Germany, to Northville, Michigan.
Advantage sat down with Sebastiano to talk about the highly competitive seat-heating market and how he keeps the company ahead of the pack.
Advantage: W. E. T. owns the majority of the seat-heating market worldwide. How do you maintain that leadership position?
Vincent Sebastiano: Our industry is very cost driven—yet, at the same time, one-on-one. We support our customers from research to design, development, engineering, program management, and low-cost production across three triads—North America, Europe, and Asia. This gives us a strong reach and a support system that provides localized expertise. In addition, sales listens to the customers’ needs, which allows us to develop new products and technologies that will meet customers’ needs for tomorrow.
Were you affected by the collapse of the US auto market?
Yes. North American production from 2000 to 2007 was in the area of 16 million vehicles a year. In 2008 and 2009, that output dropped to around 9 million. We had head-count reductions. We lost shifts. We downsized accordingly to remain competitive, without compromising the resources necessary to keep up our excellent customer service. This helped us gain significant market share, as our competitors had a more aggressive cost-cutting approach. We have since rebounded and rehired some positions, but the industry itself is nowhere near prerecessionary levels. Output is about 12–13 million now.
How has your background and upbringing influenced your business decisions?
My family was working class. We were very close-knit. It provided me with a value system that I use today, not only as a parent, but in how I approach life and work—with a strong work ethic, empathy, and a good feeling for my customers, suppliers, and employees. It’s made me someone who is fair and equitable. Growing up with three siblings during tough times, I understand the value of sharing limited resources.
How will W. E. T.’s acquisition by your competitor Amerigon change the company?
Our aim is to bring the combined strengths of two excellent companies together and deliver best-in-industry products in overall seat-comfort solutions. We will pool our competencies to drive innovation in new products and markets to fuel our growth.
I think the most important lesson was that, while gut feel can still play a role, when it comes to organizations that have fiduciary responsibilities to stakeholders, it’s very important to gather hard facts, hard data, and buy-in from all affected parties when making decisions.
What do you consider to be the company’s greatest strength?
It would be the customer-service proposition we offer. The company has gone from traditional hierarchies with department heads to a lean structure in which the product goes from design to production error-free, with quality that meets customer expectations. We train all our employees in lean basics, and we’re involved with Lean Alliance. They provide training to our employees in lean thinking and processes. In addition, we eliminate waste and streamline processes.
What do you think is the best business decision you’ve ever made?
When I joined the company, there was concern about the relationship between Windsor and Acuña [Mexico], as well as among the departments here. I assessed the situation, made some tough decisions and reorganized people into new leadership roles. This, along with several other HR initiatives, has provided a different culture and improved both operations and employee satisfaction.
What’s the biggest business challenge you’ve faced and how have you overcome it?
We’re experiencing it right now. We’re going to be introducing new heat mediums to car seats, using heated inks and flexible substrates aimed at reducing warranty claims in the field. The business awarded was very aggressive, and we needed to do some extra work to create better financial returns. I’ve tasked my team to utilize all the resources available to them to ensure that we not only get this technology delivered on time to our customers, but do it at a cost that gives us reasonable returns. The product is due late next year, and we’ve made considerable improvements.
What’s next for W. E. T.?
We’re looking at ways we can heat and cool the interior cabin of a car so it can rely less on HVAC systems, making cars more efficient and eco-friendly. We’re also starting to look at nonautomotive markets. Amerigon provides heating and cooling inside mattresses, so that gives you an idea that we have the capability to heat and cool many applications. Automotive is our core competency, but we’re looking at strategic alternatives that can make us grow and will provide value to our stakeholders.